Daily Currency Update
GBP - British PoundOver the last few years investors have been caught out by comments and the reaction of sterling at the end of the Tory party conferences, so today all eyes will be on Boris Johnson's speech around midday. Having had his Brexit plan leaked Johnson is now expected to state that now is the time to formalise Brexit. Despite lawmakers voting to block a No Deal Brexit, the risks still remain high with the official line from No. 10 is that an extension would not be negotiated. GBP/USD still hovers around 1.2200 - 1.2300 but watch out for Johnson's speech. In 2016 when Theresa May took to the podium sterling went onto its worst week since the Brexit vote.
Key Movers
Safe haven assets were in vogue yesterday as the market mood shifted towards risk-off. This was all off the back of the terrible ISM Manufacturing PMIs, the worst in 10 years. There are now growing fears that the US/China trade war is taking real effect on the US economy and mirrors the drop in output from China and the woeful economic performance of Germany. President Trump however blamed Federal Reserve Chairman Jerome Powell for this, stating that his policies of high interest rates has strengthened the dollar too much to the detriment of US manufacturing exports.The move to safe haven assets saw the Japanese Yen strengthen against the USD whilst gold prices crept back towards $1500. ADP employment figures later today could further cement the weak position the US economy finds itself in which could see more gains for the Yen, USD and CHF whilst the Euro could struggle.
Expected Ranges
- GBP/USD: 1.2210 - 1.2310 ▼
- GBP/EUR: 1.1190 - 1.1310 ▼
- GBP/AUD: 1.8280 - 1.8360 ▲
- GBP/NZD: 1.9620 - 1.9720 ▲